<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


(Mark One)

[XX] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

For the quarterly period ended MARCH 31, 2000
                               ------------------------------------------------

                                       OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from ________________________to______________________

                               ________________________


For Quarter Ended March 31, 2000                   Commission File No.  0-21390

                              AFG INVESTMENT TRUST B
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>

<S>                                                       <C>
DELAWARE                                                  04-3157230
--------------------------------                          ---------------------
(State or other jurisdiction of                           (IRS Employer
 incorporation or organization)                           Identification No.)

88 BROAD STREET, BOSTON, MA                               02110
-------------------------------                           ---------------------
(Address of principal executive offices)                  (Zip Code)
</TABLE>

Registrant's telephone number, including area code (617) 854-5800
                                                   ------------------

--------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report.)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes   X    No
                                             -------   ------


                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

     Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes_____ No______


<PAGE>


                             AFG Investment Trust B

                                    FORM 10-Q

                                      INDEX

<TABLE>
<CAPTION>

                                                                          PAGE

<S>                                                                       <C>
PART I.  FINANCIAL INFORMATION:

    Item 1.   Financial Statements

      Statement of Financial Position
        at March 31, 2000 and December 31, 1999                               3

      Statement of Operations
        for the three months ended March 31, 2000 and 1999                    4

      Statement of Changes in Participants' Capital
        for the three months ended March 31, 2000                             5

      Statement of Cash Flows
        for the three months ended March 31, 2000 and 1999                    6

      Notes to the Financial Statements                                    7-10

    Item 2.   Management's Discussion and Analysis of Financial
              Condition and Results of Operations                         11-14

PART II.  OTHER INFORMATION:

    Items 1 - 6                                                              15
</TABLE>


                                       2
<PAGE>




                                              AFG Investment Trust B

                                          STATEMENT OF FINANCIAL POSITION
                                       March 31, 2000 and December 31, 1999

                                                    (Unaudited)
<TABLE>
<CAPTION>

                                                                    March 31,       December 31,
                                                                      2000              1999
                                                                    --------          --------

<S>                                                                <C>              <C>

ASSETS

Cash and cash equivalents                                          $    5,080,308   $   10,193,277
Marketable securities                                                      69,920          108,544
Rents receivable                                                           20,186              635
Accounts receivable - affiliate                                           118,003          112,228
Accounts receivable - other                                                63,904               --
Interest receivable                                                           556            3,681
Investment in EFG/Kirkwood                                              1,481,976        1,353,400
Equipment at cost, net of accumulated depreciation
   of $6,579,869 and $6,686,836 at March 31, 2000
   and December 31, 1999, respectively                                  1,197,959        1,280,251
                                                                   --------------   --------------

         Total assets                                              $    8,032,812   $   13,052,016
                                                                   ==============   ==============

LIABILITIES AND PARTICIPANTS' CAPITAL

Notes payable                                                      $      628,951   $      656,454
Accrued interest                                                            2,130            2,386
Accrued liabilities                                                        29,825           53,608
Accrued liabilities - affiliate                                            23,223           15,436
Deferred rental income                                                     42,153           42,050
Cash distributions payable to participants                                     --        5,300,000
                                                                   --------------   --------------
         Total liabilities                                                726,282        6,069,934
                                                                   --------------   --------------
Participants' capital (deficit):
   Managing Trustee                                                       (11,175)         (26,988)
   Special Beneficiary                                                    (91,951)        (222,647)
   Class A Beneficiary Interests (582,017 Interests;
     initial purchase price of $25 each)                                8,330,450        8,336,812
   Class B Beneficiary Interests (1,000,961 Interests;
     initial purchase price of $5 each)                                  (129,419)        (313,720)
   Treasury Interests (83,477 Class A Interests at Cost)                 (791,375)        (791,375)
                                                                   --------------   --------------
         Total participants' capital                                    7,306,530        6,982,082
                                                                   --------------   --------------

         Total liabilities and participants' capital               $    8,032,812   $   13,052,016
                                                                   ==============   ==============
</TABLE>

                     The accompanying notes are an integral
                       part of these financial statements.


                                       3
<PAGE>


                             AFG Investment Trust B

                             STATEMENT OF OPERATIONS
               for the three months ended March 31, 2000 and 1999

                                   (Unaudited)

<TABLE>
<CAPTION>

                                                              2000                    1999
                                                          --------------          --------------

<S>                                                       <C>                     <C>

Income:

    Lease revenue                                         $     278,630           $    323,741

    Interest income                                              93,535                109,986

    Gain (loss) on sale of equipment                             (4,140)               144,615

    Gain on sale of marketable securities                        21,520                     --

    Other income                                                 68,110                261,116
                                                          ---------------         ---------------

      Total income                                              457,655                839,458
                                                          ---------------         ---------------

Expenses:

    Depreciation                                                 39,152                322,765

    Interest expense                                             11,958                 12,957

    Management fees - affiliates                                 17,165                 15,822

    Operating expenses - affiliate                               57,816                251,055
                                                          ---------------         ---------------

     Total expenses                                             126,091                602,599
                                                          ---------------         ---------------

Net income                                                $     331,564           $    236,859
                                                          ===============         ===============

Net income
    per Class A Beneficiary Interest                      $          --           $       0.24
                                                          ===============         ==============
    per Class B Beneficiary Interest                      $         0.18          $       0.07
                                                          ==============          ==============

Cash distributions declared
    per Class A Beneficiary Interest                      $          --           $       0.41
                                                          ===============         ==============

    per Class B Beneficiary Interest                      $          --           $       0.12
                                                          ===============         ==============
</TABLE>

                     The accompanying notes are an integral
                       part of these financial statements.


                                       4
<PAGE>


                             AFG Investment Trust B

                  STATEMENT OF CHANGES IN PARTICIPANTS' CAPITAL
                    for the three months ended March 31, 2000

                                   (Unaudited)

<TABLE>
<CAPTION>

                                              Managing          Special
                                               Trustee        Beneficiary           CLASS A BENEFICIARIES
                                               AMOUNT           AMOUNT          INTERESTS          AMOUNT
                                           --------------   --------------   --------------    ---------------

<S>                                        <C>              <C>                     <C>        <C>
Balance at December 31, 1999               $     (26,988)   $     (222,647)         582,017    $     8,336,812

     Net income                                   15,884           131,039               --                 --

     Unrealized loss on marketable
        securities                                   (71)             (343)              --             (6,362)
                                           -------------    --------------   --------------    ---------------
Comprehensive income                              15,813           130,696               --             (6,362)
                                           -------------    --------------   --------------    ---------------
Balance at March 31, 2000                  $     (11,175)   $      (91,951)         582,017    $     8,330,450
                                           =============    ==============   ==============    ===============
</TABLE>

<TABLE>
<CAPTION>
                                                  CLASS B BENEFICIARIES          Treasury
                                              INTERESTS         AMOUNT           INTERESTS           TOTAL
                                           --------------   ---------------   --------------    ----------

<S>                                             <C>         <C>               <C>               <C>
Balance at December 31, 1999                    1,000,961   $      (313,720)  $     (791,375)   $     6,982,082

     Net income                                        --           184,641               --            331,564

     Unrealized loss on marketable
        securities                                     --              (340)              --             (7,116)
                                           --------------   ---------------   --------------    ---------------
Comprehensive income                                   --           184,301               --            324,448
                                           --------------   ---------------   --------------    ---------------
Balance at March 31, 2000                       1,000,961   $      (129,419)  $     (791,375)   $     7,306,530
                                           ==============   ===============   ==============    ===============
</TABLE>

                     The accompanying notes are an integral
                       part of these financial statements.


                                       5
<PAGE>


                             AFG Investment Trust B

                             STATEMENT OF CASH FLOWS
               for the three months ended March 31, 2000 and 1999

                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                 2000                  1999
                                                                           --------------        --------------
<S>                                                                       <C>                    <C>
Cash flows from (used in) operating activities:
Net income                                                                $      331,564         $     236,859

Adjustments to reconcile net income to
   net cash from operating activities:
         Depreciation                                                             39,152               322,765
         Accretion of bond discount                                                 (624)                   --
         Loss (gain) on sale of equipment                                          4,140              (144,615)
         Gain on sale of marketable securities                                   (21,520)                   --

Changes in assets and liabilities Decrease (increase) in:
         Rents receivable                                                        (19,551)              199,645
         Accounts receivable - affiliate                                          (5,775)               24,511
         Accounts receivable - other                                             (63,904)                   --
         Interest receivable                                                       3,125                    --
    Increase (decrease) in:
         Accrued interest                                                           (256)                 (431)
         Accrued liabilities                                                     (23,783)                7,000
         Accrued liabilities - affiliate                                           7,787                 6,782
         Deferred rental income                                                      103                28,639
         Other liabilities                                                            --              (197,950)
                                                                           ---------------       ---------------

            Net cash from operating activities                                   250,458               483,205
                                                                           ---------------       ---------------

Cash flows from (used in) investing activities:
    Proceeds from equipment sales                                                 39,000            4,639,026
    Proceeds from sale of marketable securities                                   53,652                   --
    Investment in EFG/Kirkwood                                                  (128,576)                  --
                                                                           ---------------       ---------------

            Net cash from (used in) investing activities                         (35,924)           4,639,026
                                                                           ---------------       ---------------

Cash flows used in financing activities:
    Principal payments - notes payable                                           (27,503)             (73,121)
    Distributions paid                                                        (5,300,000)            (393,414)
                                                                           ---------------       ---------------

            Net cash used in financing activities                             (5,327,503)            (466,535)
                                                                           ---------------       ---------------

Net increase (decrease) in cash and cash equivalents                          (5,112,969)           4,655,696

Cash and cash equivalents at beginning of period                              10,193,277            5,909,535
                                                                           ---------------       ---------------

Cash and cash equivalents at end of period                                 $   5,080,308         $ 10,565,231
                                                                           ===============       ===============

Supplemental disclosure of cash flow information:
    Cash paid during the period for interest                               $        12,214       $     13,388
                                                                           ===============       ===============
</TABLE>


                                       6
<PAGE>


                             AFG Investment Trust B

                        Notes to the Financial Statements
                                 March 31, 2000

                                   (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

     The financial statements presented herein are prepared in conformity with
generally accepted accounting principles and the instructions for preparing Form
10-Q under Rule 10-01 of Regulation S-X of the Securities and Exchange
Commission and are unaudited. As such, these financial statements do not include
all information and footnote disclosures required under generally accepted
accounting principles for complete financial statements and, accordingly, the
accompanying financial statements should be read in conjunction with the
footnotes presented in the 1999 Annual Report. Except as disclosed herein, there
has been no material change to the information presented in the footnotes to the
1999 Annual Report.

     In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at March 31, 2000 and December 31, 1999 and results of operations for
the three months ended March 31, 2000 and 1999 have been made and are reflected.


NOTE 2 - CASH EQUIVALENTS AND MARKETABLE SECURITIES

     The Trust considers all highly liquid investments with an original maturity
of three months or less to be cash equivalents. Marketable securities consist of
equity securities and debt securities that are classified as available-for-sale.
Available-for-sale securities are carried at fair value, with unrealized gains
and losses reported as a separate component of participants' capital. The
amortized cost of debt securities is adjusted for amortization of premiums and
accretion of discounts to maturity. Such amortization and accretion are included
in interest income on the accompanying Statement of Operations.

     The Trust recorded an unrealized loss on available-for-sale securities of
$7,116 during the three months ended March 31, 2000 that is included as a
separate component of participants' capital. At March 31, 2000, total debt
securities had an amortized cost of $71,994 and a fair value of $69,920. During
the three months ended March 31, 2000, total comprehensive income amounted to
$324,448.


NOTE 3 - REVENUE RECOGNITION

     Rents are payable to the Trust monthly, quarterly or semi-annually and no
significant amounts are calculated on factors other than the passage of time.
The leases are accounted for as operating leases and are noncancellable. Rents
received prior to their due dates are deferred. In certain instances, the Trust
may enter primary-term, renewal or re-lease agreements which expire beyond the
Trust's anticipated dissolution date. This circumstance is not expected to
prevent the orderly wind-up of the Trust's business activities as the Managing
Trustee and the Advisor would seek to sell the then-remaining equipment assets
either to the lessee or to a third party, taking into consideration the amount
of future noncancellable rental payments associated with the attendant lease
agreements. Future minimum rents of $818,689 are due as follows:

<TABLE>
<CAPTION>

<S>                                                             <C>
                   For the year ending March 31, 2001           $       537,954
                                                 2002                   161,125
                                                 2003                   119,610
                                                               -----------------
                                                 Total          $       818,689
                                                               =================
</TABLE>


                                       7
<PAGE>


                             AFG Investment Trust B
                        Notes to the Financial Statements

                                   (Continued)




NOTE 4 - EQUIPMENT

     The following is a summary of equipment owned by the Trust at March 31,
2000. Remaining Lease Term (Months), as used below, represents the number of
months remaining from March 31, 2000 under contracted lease terms and is
presented as a range when more than one lease agreement is contained in the
stated equipment category. A Remaining Lease Term equal to zero reflects
equipment either held for sale or re-lease or being leased on a month-to-month
basis. In the opinion of EFG, the acquisition cost of the equipment did not
exceed its fair market value.

<TABLE>
<CAPTION>

                                                               Remaining
                                                              Lease Term                 Equipment
         Equipment Type                                        (Months)                   at cost
        ----------------                                     -------------              ------------

<S>                                                                <C>                <C>
Communications                                                        9               $    2,703,591
Materials handling                                                  0-6                    2,159,968
Aircraft                                                             33                    1,239,741
Computers and peripherals                                           0-4                    1,051,435
Tractors and heavy duty trucks                                        0                      233,794
Construction and mining                                               9                      219,162
Trailers/intermodal containers                                     0-11                      128,443
Manufacturing                                                         0                       41,694
                                                                                      --------------
                                                   Total equipment cost                    7,777,828

                                               Accumulated depreciation                   (6,579,869)
                                                                                      --------------
                             Equipment, net of accumulated depreciation               $    1,197,959
                                                                                      ==============
</TABLE>

     At March 31, 2000, the Trust's equipment portfolio included equipment
having a proportionate original cost of $5,245,162, representing approximately
67% of total equipment cost.

     The summary above includes fully-depreciated equipment held for sale or
re-lease with a cost of approximately $859,000. The Managing Trustee is actively
seeking the sale or re-lease of all equipment not on lease. In addition, the
summary above includes equipment being leased on a month-to-month basis.


NOTE 5 - INVESTMENT IN EFG/KIRKWOOD

     On May 1, 1999, the Trust and three affiliated trusts (collectively the
"Trusts") and another affiliate formed EFG/Kirkwood Capital LLC ("EFG/Kirkwood")
for the purpose of making an investment in Kirkwood Associates Inc. ("KAI").
EFG/Kirkwood's investment consists of a common stock interest in KAI of
approximately 16% as well as preferred stock and convertible debt. The Trusts
purchased Class A Interests in EFG/Kirkwood and the other affiliate purchased
Class B Interests in EFG/Kirkwood. Generally, the Class A Interest holders are
entitled to certain preferred returns prior to distribution payments to the
Class B Interest holder. KAI owns a ski resort, a local public utility, and land
which is held for development. The resort is located in Kirkwood, California and
is approximately 30 miles from South Lake Tahoe, Nevada. Subsequent to making
its investment in KAI, EFG/Kirkwood made a 50% investment in Mountain Springs
Resorts LLC, an entity formed for the purpose of acquiring an ownership interest
in a Colorado ski resort. The Trust's ownership interest in EFG/Kirkwood had a
cost of $1,481,976, including a 1% acquisition fee ($14,673) paid to EFG. The
Trust's investment in EFG/Kirkwood is accounted for on the equity method.


                                       8
<PAGE>


                             AFG Investment Trust B
                        Notes to the Financial Statements

                                   (Continued)

NOTE 6 - RELATED PARTY TRANSACTIONS

     All operating expenses incurred by the Trust are paid by EFG on behalf of
the Trust and EFG is reimbursed at its actual cost for such expenditures. Fees
and other costs incurred during the three month periods ended March 31, 2000 and
1999, which were paid or accrued by the Trust to EFG or its Affiliates, are as
follows:

<TABLE>
<CAPTION>
                                                              2000                 1999
                                                        ---------------      ---------------

<S>                                                     <C>                  <C>
     Management fees                                    $        17,165      $         15,822
     Administrative charges                                      29,947                17,631
     Reimbursable operating expenses
         due to third parties                                    27,869               233,424
                                                        ---------------      ----------------

                                    Total              $        74,981      $        266,877
                                                        ===============      ================
</TABLE>


     All rents and proceeds from the sale of equipment are paid directly to
either EFG or to a lender. EFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Trust. At
March 31, 2000, the Trust was owed $118,003 by EFG for such funds and the
interest thereon. These funds were remitted to the Trust in April 2000.


NOTE 7 - NOTES PAYABLE

     Notes payable at March 31, 2000 consisted of an installment note of
$628,951 payable to an institutional lender. The note bears a fluctuating
interest rate based on LIBOR (approximately 6% at March 31, 2000) plus a margin.
The installment note is non-recourse and is collateralized by the Trust's
interest in an aircraft leased to Reno Air, Inc. and the assignment of the
related lease payments. The Trust has a balloon payment obligation of $282,421
at the expiration of the related lease term. The carrying amount of the note
approximates fair value at March 31, 2000.

     The annual maturities of the note are as follows:
<TABLE>
<CAPTION>

<S>                                          <C>          <C>
          For the year ending March 31,      2001         $     123,169
                                             2002               131,272
                                             2003               374,510
                                                          -------------

                                             Total        $     628,951
                                                          ==============
</TABLE>

NOTE 8 - GUARANTY AGREEMENT

     On March 8, 2000, the Trust and three affiliated trusts entered into a
guaranty agreement whereby the trusts, jointly and severally, have guaranteed
the payment obligations under a master lease agreement between Echelon
Commercial LLC, a newly-formed Delaware company that is controlled by Gary D.
Engle, President and Chief Executive Officer of EFG, as lessee, and Heller
Affordable Housing of Florida, Inc., and two other entities, as lessor
("Heller"). The lease payments of Echelon Commercial LLC to Heller are supported
by lease payments to Echelon Commercial LLC from various sub-lessees who are
parties to commercial and residential lease agreements under the master lease
agreement. The guarantee of lease payments by the Trust and the three affiliated
trusts is capped at a maximum of $34,500,000, excluding expenses that could
result in the event that Echelon Commercial LLC experiences a default under the
terms of the master lease agreement. An agreement among the four trusts provides
that the Trust is responsible for 11.58% of the guaranteed amount, or
$3,995,100. In consideration for its guarantee, the Trust received an upfront
cash fee equal to $57,900 and will receive an annualized fee equal to 4% of the
average guarantee amount outstanding during each quarterly period. Accrued


                                       9
<PAGE>


                             AFG Investment Trust B
                        Notes to the Financial Statements

                                   (Continued)

but unpaid fees will accrue and compound interest quarterly at an annualized
interest rate of 7.5% until paid. The Trust will receive minimum aggregate fees
for its guarantee of not less than $115,800, excluding interest. During the
period March 8, 2000 to March 31, 2000, the Trust accrued a guaranty fee of
$10,210. The upfront cash fee and the accrued but unpaid guaranty fee are
reflected as Other Income on the accompanying Statement of Operations for the
three months ended March 31, 2000.


                                       10
<PAGE>


                             AFG Investment Trust B

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

     Certain statements in this quarterly report of AFG Investment Trust B (the
"Trust") that are not historical fact constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995 and
are subject to a variety of risks and uncertainties. There are a number of
important factors that could cause actual results to differ materially from
those expressed in any forward-looking statements made herein. These factors
include, but are not limited to, the collection of the Trust's contracted rents,
the realization of residual proceeds for the Trust's equipment, the performance
of the Trust's non-equipment investments, and future economic conditions.

THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO THE THREE MONTHS ENDED MARCH 31,
1999:

RESULTS OF OPERATIONS

     For the three months ended March 31, 2000, the Trust recognized lease
revenue of $278,630 compared to $323,741 for same period in 1999. The decrease
in lease revenue from 1999 to 2000 resulted principally from lease term
expirations and the sale of equipment. The level of lease revenue to be
recognized by the Trust in the future may be impacted by future reinvestment;
however, the extent of such impact cannot be determined at this time.

     The Trust's equipment portfolio includes certain assets in which the Trust
holds a proportionate ownership interest. In such cases, the remaining interests
are owned by EFG or an affiliated equipment leasing program sponsored by EFG.
Proportionate equipment ownership enables the Trust to further diversify its
equipment portfolio by participating in the ownership of selected assets,
thereby reducing the general levels of risk which could result from a
concentration in any single equipment type, industry or lessee. The Trust and
each affiliate individually report, in proportion to their respective ownership
interests, their respective shares of assets, liabilities, revenues, and
expenses associated with the equipment.

     Interest income for the three months ended March 31, 2000 was $93,535
compared to $109,986 for the same period in 1999. Generally interest income is
generated from the temporary investment of rental receipts and equipment sales
proceeds in short-term instruments. Interest income in 1999 also included
interest earned on proceeds from the issuance of the Trust's Class B Interests
in 1997. The amount of future interest income is expected to fluctuate as a
result of changing interest rates, the collection of lease revenue, and the
proceeds from equipment sales, among other factors. In addition, the Trust
distributed $5,300,000 in January 2000, which resulted in a reduction in cash
available for investment.

     On March 8, 2000, the Trust and three affiliated trusts entered into a
guaranty agreement whereby the trusts, jointly and severally, have guaranteed
the payment obligations under a master lease agreement between Echelon
Commercial LLC, as lessee, and Heller Affordable Housing of Florida, Inc., and
two other entities, as lessor ("Heller"). In consideration for its guarantee,
the Trust received an upfront cash fee equal to $57,900 and will receive an
annualized fee equal to 4% of the average guarantee amount outstanding during
each quarterly period. Accrued but unpaid fees will accrue and compound interest
quarterly at an annualized interest rate of 7.5% until paid. During the period
March 8, 2000 to March 31, 2000, the Trust accrued a guaranty fee of $10,210.
The upfront cash fee and the accrued but unpaid guaranty fee are reflected as
Other Income on the accompanying Statement of Operations for the three months
ended March 31, 2000.

     The Trust received $261,116 in 1999 as a breakage fee from a third-party
seller in connection with a transaction for new investments that was canceled by
the seller in the first quarter of 1999. This amount is reflected as Other
Income on the accompanying Statement of Operations for the three months ended
March 31, 1999.


                                       11
<PAGE>

                             AFG Investment Trust B

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

     During the three months ended March 31, 2000, the Trust sold equipment
having a net book value of $43,140 to existing lessees and third parties. These
sales resulted in a net loss, for financial statement purposes, of $4,140
compared to a net gain of $144,615 on equipment having a net book value of
$4,494,411 during the same period in 1999.

     It cannot be determined whether future sales of equipment will result in a
net gain or a net loss to the Trust, as such transactions will be dependent upon
the condition and type of equipment being sold and its marketability at the time
of sale. In addition, the amount of gain or loss reported for financial
statement purposes is partly a function of the amount of accumulated
depreciation associated with the equipment being sold.

     The ultimate realization of residual value for any type of equipment is
dependent upon many factors, including EFG's ability to sell and re-lease
equipment. Changing market conditions, industry trends, technological advances,
and many other events can converge to enhance or detract from asset values at
any given time. EFG attempts to monitor these changes in order to identify
opportunities which may be advantageous to the Trust and which will maximize
total cash returns for each asset.

     The total economic value realized upon final disposition of each asset is
comprised of all primary lease term revenue generated from that asset, together
with its residual value. The latter consists of cash proceeds realized upon the
asset's sale in addition to all other cash receipts obtained from renting the
asset on a re-lease, renewal or month-to-month basis. The Trust classifies such
residual rental payments as lease revenue. Consequently, the amount of gain or
loss reported in the financial statements is not necessarily indicative of the
total residual value the Trust achieved from leasing the equipment.

     Depreciation expense was $39,152 and $322,765 for the three months ended
March 31, 2000 and 1999, respectively. For financial reporting purposes, to the
extent that an asset is held on primary lease term, the Trust depreciates the
difference between (i) the cost of the asset and (ii) the estimated residual
value of the asset on a straight-line basis over such term. For purposes of this
policy, estimated residual values represent estimates of equipment values at the
date of primary lease expiration. To the extent that an asset is held beyond its
primary lease term, the Trust continues to depreciate the remaining net book
value of the asset on a straight-line basis over the asset's remaining economic
life.

     Interest expense was $11,958 or 4.3% of lease revenue in 2000 and $12,957
or 4% of lease revenue in 1999. Management fees were $17,165 and $15,822 in 2000
and 1999, respectively. Management fees are based on 5% of gross lease revenue
generated by operating leases and 2% of gross lease revenue generated by full
payout leases. Management fees also include a 1% management fee on non-equipment
investments, excluding cash.

     Operating expenses consist principally of administrative charges,
professional service costs, such as audit and legal fees, as well as printing,
distribution and remarketing expenses. Collectively, operating expenses were
$57,816 and $251,055 during the three months ended March 31, 2000 and 1999,
respectively. Operating expenses were higher in 1999 principally as a result of
costs incurred of approximately $191,000 related to the repair and remarketing
of an aircraft formerly leased to Alaska Airlines, Inc. in which the Trust held
an interest. The amount of future operating expenses cannot be predicted with
certainty; however, such expenses are usually higher during the acquisition and
liquidation phases of a trust. Other fluctuations typically occur in relation to
the volume and timing of remarketing activities.


LIQUIDITY AND CAPITAL RESOURCES AND DISCUSSION OF CASH FLOWS

     The Trust by its nature is a limited life entity. As an equipment leasing
program, the Trust's principal operating activities derive from asset rental
transactions. Accordingly, the Trust's principal source of cash from operations
is provided by the collection of periodic rents. These cash inflows are used to
satisfy debt service


                                       12
<PAGE>

                             AFG Investment Trust B

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

obligations associated with leveraged leases, and to pay management fees and
operating costs. Operating activities generated net cash inflows of $250,458 and
$483,205 for the three months ended March 31, 2000 and 1999, respectively.
Future renewal, re-lease and equipment sale activities will cause a decline in
the Trust's primary-term lease revenue and corresponding sources of operating
cash. Expenses associated with rental activities, such as management fees, also
will decline as the Trust experiences a higher frequency of remarketing events.

     The Trust's equipment is leased by a number of creditworthy,
investment-grade companies and, to date, the Trust has not experienced any
material collection problems and has not considered it necessary to provide an
allowance for doubtful accounts. Notwithstanding a positive collection history,
there is no assurance that all future contracted rents will be collected or that
the credit quality of the Trust's lessees will be maintained. Collection risk
could increase in the future, particularly as the Trust remarkets its equipment
and enters re-lease agreements with different lessees. The Managing Trustee will
continue to evaluate and monitor the Trust's experience in collecting accounts
receivable to determine whether a future allowance for doubtful accounts may
become appropriate.

     Cash expended for asset acquisitions and cash realized from asset disposal
transactions are reported under investing activities on the accompanying
Statement of Cash Flows. During the three months ended March 31, 2000, the Trust
expended $128,576 for its investment in EFG/Kirkwood (see Note 5). During the
three months ended March 31, 2000, the Trust realized net cash proceeds from
asset disposals of $39,000 compared to $4,639,026 for the same period in 1999.
Sale proceeds in 1999 include $4,619,262 related to the Trust's 39.59% interest
in a McDonnell Douglas MD-82 aircraft formerly leased to Alaska Airlines, Inc.
which was sold in January 1999. Future inflows of cash from asset disposals will
vary in timing and amount and will be influenced by many factors including, but
not limited to, the frequency and timing of lease expirations, the type of
equipment being sold, its condition and age, and future market conditions. The
Trust also realized proceeds from the sale of marketable securities of $53,652
during the three months ended March 31, 2000.

     The Trust obtained long-term financing in connection with certain equipment
leases. The repayments of principal related to such indebtedness are reported as
a component of financing activities. At March 31, 2000, the Trust had only one
debt obligation outstanding pertaining to its ownership interest in an aircraft
leased to Reno Air, Inc. That note will be partially amortized by the remaining
contracted lease payments. Upon expiration of the lease agreement in 2003, the
Trust will have a balloon payment obligation of $282,421 to retire this
indebtedness.

     In accordance with Statement of Financial Accounting Standards No. 115,
Accounting for Certain Investments in Debt and Equity Securities, marketable
debt and equity securities classified as available-for-sale are required to be
carried at fair value. During the three months ended March 31, 2000, the Trust
recorded an unrealized loss on available-for-sale securities of $7,116.

     At March 31, 2000, the Trust was due aggregate future minimum lease
payments of $818,689 from contractual lease agreements (see Note 3 to the
financial statements), a portion of which will be used to amortize the principal
balance of notes payable of $628,951 (see Note 7 to the financial statements).
Additional cash inflows will be realized from future remarketing activities,
such as lease renewals and equipment sales, the timing and extent of which
cannot be predicted with certainty. This is because the timing and extent of
equipment sales is often dependent upon the needs and interests of the existing
lessees. Some lessees may choose to renew their lease contracts, while others
may elect to return the equipment. In the latter instances, the equipment could
be re-leased to another lessee or sold to a third party. Accordingly, as the
Trust matures and a greater level of its equipment assets becomes available for
remarketing, the cash flows of the Trust will become less predictable.

     During 1999, the Managing Trustee evaluated and pursued a number of
potential new investments, several of which the Managing Trustee concluded had
market returns that it believed were less than adequate given the potential
risks. Most transactions involved the equipment leasing, business finance and
real estate development industries. Although the Managing Trustee intends to
continue to evaluate additional new investments, it


                                       13
<PAGE>

                             AFG Investment Trust B

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

anticipates that the Trust will be able to fund these new investments with cash
on hand or other sources, such as the proceeds from future asset sales or
refinancings and new indebtedness. As a result, the Trust declared a special
cash distribution during the fourth quarter of 1999 to the Trust Beneficiaries
totaling $5,300,000 which was paid on January 19, 2000.

     After the special distribution on January 19, 2000, the Trust adopted a new
distribution policy and suspended the payment of regular monthly cash
distributions. Looking forward, the Managing Trustee presently does not expect
to reinstate cash distributions until expiration of the Trust's reinvestment
period in December 2001; however, the Managing Trustee periodically will review
and consider other one-time distributions. In addition to maintaining sale
proceeds for reinvestment, the Managing Trustee expects that the Trust will
retain cash from operations to fully retire its balloon debt obligation and for
the continued maintenance of the Trust's assets. The Managing Trustee believes
that this change in policy is in the best interests of the Trust over the long
term and will have the added benefit of reducing the Trust's distribution
expenses.

     In the future, the nature of the Trust's operations and principal cash
flows gradually will shift from rental receipts to equipment sale proceeds as
the Trust matures and change as a result of potential new investments not
consisting of equipment acquisitions. As this occurs, the Trust's cash flows
resulting from equipment investments may become more volatile in that certain of
the Trust's equipment leases will be renewed and certain of its assets will be
sold. In some cases, the Trust may be required to expend funds to refurbish or
otherwise improve the equipment being remarketed in order to make it more
desirable to a potential lessee or purchaser. The Trust's Advisor, EFG, and the
Managing Trustee will attempt to monitor and manage these events in order to
maximize the residual value of the Trust's equipment and will consider these
factors, in addition to new investment activities, the collection of contractual
rents, the retirement of scheduled indebtedness, and the Trust's future working
capital requirements, in establishing the amount and timing of future cash
distributions.

     In accordance with the Trust Agreement, upon the dissolution of the Trust,
the Managing Trustee will be required to contribute to the Trust an amount equal
to any negative balance which may exist in the Managing Trustee's tax capital
account. At December 31, 1999, the Managing Trustee had a positive tax capital
account balance. No such requirement exists with respect to the Special
Beneficiary.


                                       14
<PAGE>


                             AFG Investment Trust B

                                    FORM 10-Q

                           PART II. OTHER INFORMATION


<TABLE>
<CAPTION>

<S>                                    <C>
        Item 1.                        Legal Proceedings
                                       Response:  None

        Item 2.                        Changes in Securities
                                       Response:  None

        Item 3.                        Defaults upon Senior Securities
                                       Response:  None

        Item 4.                        Submission of Matters to a Vote of Security Holders
                                       Response:  None

        Item 5.                        Other Information
                                       Response:  None

        Item 6(a).                     Exhibits
                                       Response:  None

        Item 6(b).                     Reports on Form 8-K
                                       Response:  None
</TABLE>


                                       15
<PAGE>


                                 SIGNATURE PAGE



     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on behalf of the registrant and in the capacity and
on the date indicated.



                                              AFG Investment Trust B
<TABLE>
<CAPTION>

<S>                            <C>      <C>
                               By:      AFG ASIT Corporation, a Massachusetts
                                        corporation and the Managing Trustee of
                                        the Registrant.


                               By:      /s/  MICHAEL J. BUTTERFIELD
                                        -------------------------------
                                        Michael J. Butterfield
                                        Treasurer AFG ASIT Corporation
                                        (Duly Authorized Officer and
                                        Principal Accounting Officer)


                               Date:    MAY 15, 2000
                                        -------------------------------


                               By:      /s/  GARY ROMANO
                                        -------------------------------
                                        Gary M. Romano
                                        Clerk of AFG ASIT Corporation
                                        (Duly Authorized Officer and
                                        Principal Financial Officer)


                               Date:    MAY 15, 2000
                                        -------------------------------
</TABLE>


                                       16